Saudi Arabia raised its holdings of US Treasury bonds to $140.3 billion by the end of last May, becoming the largest holder of US bonds in the Middle East, according to the latest data from the US Treasury Department.

Saudi Arabia ranks 17th among the largest foreign holders of US Treasury bonds, after Brazil with holdings of $168.9 billion, and before South Korea with holdings of $132.3 billion.

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The Kingdom's holdings of US Treasury bonds are part of its broader foreign reserves. Total Saudi reserve assets amounted to 1.83 trillion Saudi riyals ($486.3 billion) at the end of May, rising to 1.85 trillion Saudi riyals, or approximately $494.55 billion, at the end of June. Reserve assets include monetary gold, foreign currency reserves, special drawing rights, the reserve position at the International Monetary Fund, and other reserve assets.

Movement of US Treasury bonds

The US Treasury Department's report on international capital provides one of the clearest monthly indicators of global demand for US Treasury bonds, tracking holdings by foreign governments and investors. This data is widely monitored as an indicator of international capital flows, reserve management strategies, and confidence in the world's largest sovereign bond market. The US Treasury Department reported that foreign investors recorded net purchases of $132.2 billion in US securities in May. Foreign residents bought a net $262.8 billion in long-term US securities during the month, while reducing their holdings of Treasury bonds by $43.5 billion. Japan remained the largest foreign holder of US Treasury bonds in May, at $1.143 trillion, followed by the United Kingdom at $948.6 billion, then China at $659.3 billion. Total foreign holdings of US Treasury bonds amounted to $9.37 trillion, up from $9.35 trillion in April.